Special Economic Zones attract investment of $US 32 million

The amount of private investment in Russia’s Special Economic Zones (SEZs) has reached almost $US 32 million dollars. However, there's still a lot to do before the zones start to affect Russia’s economy.

Russia is accelerating the development of Special Economic Zones across the country. The creation of three different types of zones – technological, industrial and tourist – was a move by the Russian government to diversify and attract business to the country.

According to Elvira Nabiullina, the Minister of Economic Development and Trade, 2008 will be the key year for the projects.

So far there are 13 zones but fewer then half of them have begun operating. Only one zone, in  Elabuga in Tatarstan region, has actually been opened. It will produce car plants in co-operation with foreign manufacturers.

Some analysts are sceptical of the plan for the zones, criticising the remote locations, lack of infrastructure and slow progress.

Evgeny Govrilenkov, Chief Economist at Troika Dialog, says these projects are not enough to offset the lack of infrastructure.

Since 2006, there hasn’t been much done in this regard.

However, the Russian government remains confident that a skilled workforce and cheap land and natural resources will guarantee the projects’ success.

“The economic zones will increase the country's competitiveness, diversify the economy, create necessary conditions for a better business environment and also create more jobs in the regions,” Nabiullina said.